Resilient business line revenue growth continued as the pace
of the market-wide pullback in transaction activity eased
CHICAGO, Feb. 27,
2024 /PRNewswire/ -- Jones Lang LaSalle Incorporated
(NYSE: JLL) today reported operating income of $290.4 million for the fourth quarter of
2023, up from $254.7 million last
year, and $576.5 million for the full
year, compared with $868.1 million in
2022. Diluted earnings per share were $3.57 and adjusted diluted earnings per
share1 were $4.23 for the
quarter; diluted earnings per share were $4.67 and adjusted diluted earnings per
share1 were $7.40 for the
full year.
- Fourth-quarter revenue was $5.9
billion, up 4% in local currency1, and fee
revenue1 was $2.2 billion,
down 2% in local currency1
- Work Dynamics achieved broad-based growth across all service
lines, highlighted by the ramp up of recent contract wins
- Capital Markets had solid performance against the lowest
fourth-quarter investment sales market volumes since 2011
- Property Management, within Markets Advisory, delivered
double-digit growth from strong momentum across the globe
- Also within Markets Advisory, the office sector in the U.S.
drove the single-digit decline in Leasing as other asset classes
were largely flat
- Fourth-quarter margin reflected lower transaction-based
revenues and unrealized investment losses associated with certain
JLL Technologies portfolio investments, partially offset by growth
in resilient revenue and the impact of recent cost mitigation
actions, reducing the expense base
- Nearly $130 million of
incremental cash was generated by operating activities for the
quarter; over $375 million
incremental for the full year
"JLL's fourth-quarter and full-year 2023 operating results
reflected strong growth within our resilient business lines in the
face of the market-wide pullback in transaction activity and
elevated geopolitical uncertainty. With a focus on operating
efficiency, we drove improved cash generation while continuing to
invest in our platform," said Christian
Ulbrich, JLL CEO. "As business confidence globally begins to
improve alongside greater stability in interest rates, we expect
transaction activity will pick up over the course of the year. Our
global platform, industry insights and people uniquely position us
to seize significant growth opportunities across the commercial
real estate industry in the coming years while continuing to
provide exceptional service to our clients."
Summary Financial
Results
($ in millions,
except per share data, "LC" = local currency)
|
Three Months Ended
December 31,
|
|
Year Ended December
31,
|
2023
|
|
2022
|
% Change
in USD
|
% Change
in LC
|
|
2023
|
|
2022
|
% Change
in USD
|
% Change
in LC
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
$
5,881.4
|
|
$
5,604.8
|
5 %
|
4 %
|
|
$
20,760.8
|
|
$ 20,862.1
|
— %
|
— %
|
Fee
revenue1
|
2,180.4
|
|
2,214.1
|
(2)
|
(2)
|
|
7,403.1
|
|
8,302.0
|
(11)
|
(11)
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income attributable
to common shareholders
|
$
172.4
|
|
$
174.8
|
(1) %
|
1 %
|
|
$
225.4
|
|
$
654.5
|
(66) %
|
(64) %
|
Adjusted net income
attributable to common shareholders1
|
204.5
|
|
210.6
|
(3)
|
(1)
|
|
357.5
|
|
775.1
|
(54)
|
(53)
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
share
|
$
3.57
|
|
$
3.62
|
(1) %
|
1 %
|
|
$
4.67
|
|
$
13.27
|
(65) %
|
(63) %
|
Adjusted diluted
earnings per share1
|
4.23
|
|
4.36
|
(3)
|
(2)
|
|
7.40
|
|
15.71
|
(53)
|
(52)
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA1
|
$
306.4
|
|
$
338.5
|
(9) %
|
(9) %
|
|
$
736.7
|
|
$
1,247.3
|
(41) %
|
(40) %
|
|
|
|
|
|
|
|
|
|
|
|
|
Free Cash
Flow5
|
$
680.2
|
|
$
532.0
|
28 %
|
n/a
|
|
$
388.9
|
|
$
(5.9)
|
n.m.
|
n/a
|
|
Note: For discussion
and reconciliation of non-GAAP financial measures, see the Notes
following the Financial Statements in this news release.
|
Consolidated 2023 Performance Highlights:
Consolidated
($ in
millions, "LC" = local currency)
|
Three Months Ended
December 31,
|
|
%
Change
in USD
|
|
%
Change
in LC
|
|
Year Ended December
31,
|
|
%
Change
in USD
|
|
%
Change
in LC
|
2023
|
|
2022
|
|
|
|
2023
|
|
2022
|
|
|
Markets
Advisory
|
$
1,197.4
|
|
$
1,186.3
|
|
1 %
|
|
— %
|
|
$
4,121.6
|
|
$
4,415.5
|
|
(7) %
|
|
(6) %
|
Capital
Markets
|
537.1
|
|
607.9
|
|
(12)
|
|
(13)
|
|
1,778.0
|
|
2,488.2
|
|
(29)
|
|
(29)
|
Work
Dynamics
|
3,966.1
|
|
3,634.6
|
|
9
|
|
8
|
|
14,131.1
|
|
13,268.5
|
|
7
|
|
7
|
JLL
Technologies
|
65.5
|
|
57.3
|
|
14
|
|
14
|
|
246.4
|
|
213.9
|
|
15
|
|
15
|
LaSalle
|
115.3
|
|
118.7
|
|
(3)
|
|
(4)
|
|
483.7
|
|
476.0
|
|
2
|
|
2
|
Total
revenue
|
$
5,881.4
|
|
$
5,604.8
|
|
5 %
|
|
4 %
|
|
$
20,760.8
|
|
$
20,862.1
|
|
— %
|
|
— %
|
Gross contract
costs1
|
(3,709.7)
|
|
(3,392.5)
|
|
9
|
|
9
|
|
(13,375.9)
|
|
(12,549.1)
|
|
7
|
|
7
|
Net non-cash MSR and
mortgage banking derivative activity
|
8.7
|
|
1.8
|
|
(383)
|
|
(381)
|
|
18.2
|
|
(11.0)
|
|
(265)
|
|
(266)
|
Total fee
revenue1
|
$
2,180.4
|
|
$
2,214.1
|
|
(2) %
|
|
(2) %
|
|
$
7,403.1
|
|
$
8,302.0
|
|
(11) %
|
|
(11) %
|
Markets
Advisory
|
895.6
|
|
915.3
|
|
(2)
|
|
(3)
|
|
2,968.0
|
|
3,360.2
|
|
(12)
|
|
(11)
|
Capital
Markets
|
532.2
|
|
598.9
|
|
(11)
|
|
(12)
|
|
1,748.7
|
|
2,430.2
|
|
(28)
|
|
(28)
|
Work
Dynamics
|
582.2
|
|
534.3
|
|
9
|
|
8
|
|
1,999.7
|
|
1,864.7
|
|
7
|
|
7
|
JLL
Technologies
|
62.0
|
|
54.2
|
|
14
|
|
14
|
|
231.9
|
|
200.2
|
|
16
|
|
16
|
LaSalle
|
108.4
|
|
111.4
|
|
(3)
|
|
(4)
|
|
454.8
|
|
446.7
|
|
2
|
|
2
|
Operating
income
|
$
290.4
|
|
$
254.7
|
|
14 %
|
|
15 %
|
|
$
576.5
|
|
$
868.1
|
|
(34) %
|
|
(33) %
|
Equity (losses)
earnings
|
$
(76.8)
|
|
$
(21.6)
|
|
(256) %
|
|
(256) %
|
|
$
(194.1)
|
|
$
51.0
|
|
(481) %
|
|
(480) %
|
Adjusted
EBITDA1
|
$
306.4
|
|
$
338.5
|
|
(9) %
|
|
(9) %
|
|
$
736.7
|
|
$
1,247.3
|
|
(41) %
|
|
(40) %
|
Net income margin
attributable to common shareholders (USD basis)
|
2.9 %
|
|
3.1 %
|
|
(20) bps
|
|
n/a
|
|
1.1 %
|
|
3.1 %
|
|
(200) bps
|
|
n/a
|
Adjusted EBITDA margin
(local currency basis)
|
14.3 %
|
|
15.3 %
|
|
(120) bps
|
|
(100) bps
|
|
10.0 %
|
|
15.0 %
|
|
(500) bps
|
|
(500) bps
|
Adjusted EBITDA margin
(USD basis)
|
14.1 %
|
|
|
|
|
|
|
|
10.0 %
|
|
|
|
|
|
|
Note: For discussion
and reconciliation of non-GAAP financial measures, see the Notes
following the Financial Statements in this news release. Percentage
variances in the Performance
Highlights below are calculated and presented on a local currency
basis, unless otherwise noted.
|
Revenue
Revenue increased 4% and fee revenue decreased 2% compared with
the prior-year quarter. Businesses with resilient revenues
continued to deliver fee revenue growth for the quarter as
Workplace Management, within Work Dynamics, grew 17%; Property
Management, within Markets Advisory, grew 12%; and JLL Technologies
increased 14%. Consistent with earlier quarters in 2023, economic
uncertainty and elevated interest rates adversely impacted most of
the transaction-based businesses, notably Investment Sales and
Debt/Equity Advisory within Capital Markets, and Leasing within
Markets Advisory.
For the full year, revenue was flat and fee revenue decreased
11% compared with the prior year, as transaction-based businesses
lagged the prior year, consistent with the fourth-quarter
narrative. Resilient businesses, collectively, delivered 5% fee
revenue growth for the full year. Refer to segment performance
highlights for additional detail.
The following charts reflect the segment proportion of Revenue
and Fee revenue for the current quarter and full year.
Net income, Adjusted EBITDA and Margin
Performance
Net income attributable to common shareholders for the fourth
quarter was $172.4 million, compared
with $174.8 million in 2022, and
Adjusted EBITDA was $306.4 million,
compared with $338.5 million last
year. For the full year, net income attributable to common
shareholders was $225.4 million in
2023, compared with $654.5 million
last year, and Adjusted EBITDA was $736.7
million, compared with $1,247.3
million in 2022. For the fourth quarter and full year,
interest expense, net of interest income, increased $5.4 million and $60.2
million, respectively, compared with the prior-year periods.
While the fourth-quarter increase was solely driven by a higher
effective interest rate on the company's debt, the full-year
increase was also partially due to higher average outstanding
borrowings under our credit facilities.
Diluted earnings per share for the fourth quarter and full year
were $3.57 and $4.67, respectively, compared with $3.62 and $13.27 in
the respective prior-year periods; Adjusted diluted earnings per
share were $4.23 and $7.40 for the fourth quarter and full year,
respectively, compared with $4.36 and
$15.71 in 2022. The effective tax
rates for the full-year 2023 and 2022 were 10.2% and 20.2%,
respectively. The meaningfully lower ETR in 2023 was primarily
attributable to the decline in pre-tax earnings as well as the
geographic mix of income.
Higher equity losses equated to approximately 250 basis points
of the fourth-quarter margin decline. The residual net margin
expansion was primarily attributable to growth in resilient revenue
businesses, the benefit of cost reduction actions executed in the
last year, and an actuarial benefit associated with U.S. medical
self-insurance. Partially offsetting these items was the impact of
lower transaction-based revenue and the timing of incentive
compensation accruals.
The full-year margin contraction was primarily attributable to
the $245.1 million decrease in equity
earnings, which comprised nearly two-thirds of the margin decline,
and the impact of lower transaction-based revenue. Partially
offsetting these items were margin accretive drivers including
resilient revenue growth and the benefit of cost reduction actions
executed in the last year.
Aggregation of Segment Adjusted EBITDA (in
millions)
Cash Flows and Capital Allocation:
Net cash provided by operating activities was $729.4 million for the fourth quarter of 2023,
compared with $601.8 million in the
prior-year quarter. Free Cash Flow5 was an inflow of
$680.2 million this quarter, compared
with $532.0 million in the fourth
quarter of 2022. Incremental cash flows associated with lower
commission payments, cash provided by earnings, and receivables
outpaced the incremental outflows associated with net
reimbursables, attributable to recent growth in Workplace
Management from contract wins and timing of reimbursables
collections.
Year to date, net cash provided by operating activities was
$575.8 million in 2023, compared with
$199.9 million in the comparative
period. Free Cash Flow5 was an inflow of $388.9 million through December 31, 2023, compared with an outflow of
$5.9 million in the prior year. The
year-over-year improvement was primarily due to (i) improved
collection of receivables, (ii) $162.8 million less in cash taxes paid,
(iii) lower annual incentive compensation payments, typically paid
in the first quarter, compared with 2022, and (iv) lower commission
payments this year. These items were partially offset by lower cash
provided by earnings and incremental outflows associated with net
reimbursables.
In the fourth quarter of 2023, the company repurchased 147,805
shares for $21.9 million. There were
no share repurchases in the fourth quarter of 2022. On a
year-to-date basis, 410,260 shares were repurchased in 2023,
returning $62.0 million to
shareholders this year, compared with 2,922,466 shares repurchased
and $601.2 million of capital
returned during 2022. As of December 31,
2023, $1,093.6 million
remained authorized for repurchase.
Net Debt, Leverage and Liquidity5:
|
December 31,
2023
|
|
September 30,
2023
|
|
December 31,
2022
|
|
|
|
|
|
|
Total Net Debt (in
millions)
|
$
1,150.3
|
|
1,698.6
|
|
1,244.0
|
|
|
|
|
|
|
Net Leverage
Ratio
|
1.6x
|
|
2.2x
|
|
1.0x
|
|
|
|
|
|
|
Corporate Liquidity (in
billions)
|
$
3.1
|
|
2.1
|
|
2.6
|
The decrease in Net Debt from September
30, 2023, was primarily due to significant cash provided by
operating activities in the fourth quarter. The higher
year-over-year leverage ratio was entirely driven by a decline in
the trailing twelve month Adjusted EBITDA (which includes the
impact of equity losses).
Markets Advisory 2023 Performance Highlights:
Markets
Advisory
($ in
millions, "LC" = local currency)
|
Three Months Ended
December 31,
|
|
%
Change
in USD
|
|
%
Change
in LC
|
|
Year Ended December
31,
|
|
%
Change
in USD
|
|
%
Change
in LC
|
2023
|
|
2022
|
|
|
|
2023
|
|
2022
|
|
|
Revenue
|
$
1,197.4
|
|
$
1,186.3
|
|
1 %
|
|
— %
|
|
$
4,121.6
|
|
$
4,415.5
|
|
(7) %
|
|
(6) %
|
Gross contract
costs1
|
(301.8)
|
|
(271.0)
|
|
11
|
|
11
|
|
(1,153.6)
|
|
(1,055.3)
|
|
9
|
|
11
|
Fee
revenue1
|
$
895.6
|
|
$
915.3
|
|
(2) %
|
|
(3) %
|
|
$
2,968.0
|
|
$
3,360.2
|
|
(12) %
|
|
(11) %
|
Leasing
|
709.3
|
|
739.9
|
|
(4)
|
|
(5)
|
|
2,322.3
|
|
2,736.7
|
|
(15)
|
|
(15)
|
Property
Management
|
155.2
|
|
136.5
|
|
14
|
|
12
|
|
551.7
|
|
500.2
|
|
10
|
|
11
|
Advisory, Consulting
and Other
|
31.1
|
|
38.9
|
|
(20)
|
|
(20)
|
|
94.0
|
|
123.3
|
|
(24)
|
|
(23)
|
Segment operating
income
|
$
142.9
|
|
$
127.4
|
|
12 %
|
|
12 %
|
|
$
351.9
|
|
$
448.0
|
|
(21) %
|
|
(22) %
|
Adjusted
EBITDA1
|
$
160.5
|
|
$
150.2
|
|
7 %
|
|
6 %
|
|
$
416.6
|
|
$
527.5
|
|
(21) %
|
|
(21) %
|
Adjusted EBITDA margin
(local currency basis)
|
18.0 %
|
|
16.4 %
|
|
150 bps
|
|
160 bps
|
|
14.1 %
|
|
15.7 %
|
|
(170) bps
|
|
(160) bps
|
Adjusted EBITDA margin
(USD basis)
|
17.9 %
|
|
|
|
|
14.0 %
|
|
Note: For discussion
and reconciliation of non-GAAP financial measures, see the Notes
following the Financial Statements in this news release. Percentage
variances in the Performance
Highlights below are calculated and presented on a local currency
basis, unless otherwise noted.
|
Markets Advisory top-line movements for the quarter and full
year were largely driven by Leasing and reflected a decrease in
average deal size across nearly all asset types, especially the
office sector as a year-to-date driver. For the fourth quarter,
transaction volume was up in industrial but down in most other
asset classes; year to date, transaction volumes were down for all
asset classes. Consistent with recent quarters, continued economic
uncertainty has delayed commercial real estate decision making,
particularly for large-scale leasing actions where JLL has a
greater presence. Property Management's top-line growth for the
fourth-quarter and full year was primarily attributable to
portfolio expansions, most notably in the Americas, and incremental
fees from interest-rate sensitive contract terms in the U.K. (as
also noted in the second and third quarters). The decreases in
Advisory, Consulting and Other for the fourth quarter and full year
were substantially driven by the absence of revenues associated
with a business exited at the end of the fourth quarter of
2022.
The margin expansion for the fourth quarter was predominantly
driven by lower operating expenses associated with cost management
actions over the last year as well as incentive compensation
accrual timing.
The full-year margin contraction was predominantly driven by the
lower Leasing revenue (net of lower commissions) and higher
incentive compensation accruals in the current year, overshadowing
the revenue growth in Property Management and benefit associated
with cost management actions over the past year.
Capital Markets 2023 Performance Highlights:
Capital
Markets
($ in
millions, "LC" = local currency)
|
Three Months Ended
December 31,
|
|
%
Change
in USD
|
|
%
Change
in LC
|
|
Year Ended December
31,
|
|
%
Change
in USD
|
|
%
Change
in LC
|
2023
|
|
2022
|
|
|
|
2023
|
|
2022
|
|
|
Revenue
|
$
537.1
|
|
$
607.9
|
|
(12) %
|
|
(13) %
|
|
$
1,778.0
|
|
$
2,488.2
|
|
(29) %
|
|
(29) %
|
Gross contract
costs1
|
(13.6)
|
|
(10.8)
|
|
26
|
|
23
|
|
(47.5)
|
|
(47.0)
|
|
1
|
|
1
|
Net non-cash MSR and
mortgage banking derivative activity
|
8.7
|
|
1.8
|
|
(383)
|
|
(381)
|
|
18.2
|
|
(11.0)
|
|
(265)
|
|
(266)
|
Fee
revenue1
|
$
532.2
|
|
$
598.9
|
|
(11) %
|
|
(12) %
|
|
$
1,748.7
|
|
$
2,430.2
|
|
(28) %
|
|
(28) %
|
Investment Sales,
Debt/Equity Advisory and Other
|
391.0
|
|
458.1
|
|
(15)
|
|
(16)
|
|
1,245.0
|
|
1,906.7
|
|
(35)
|
|
(35)
|
Value and Risk
Advisory
|
103.1
|
|
103.7
|
|
(1)
|
|
(2)
|
|
351.1
|
|
365.6
|
|
(4)
|
|
(3)
|
Loan
Servicing
|
38.1
|
|
37.1
|
|
3
|
|
3
|
|
152.6
|
|
157.9
|
|
(3)
|
|
(3)
|
Segment operating
income
|
$
49.3
|
|
$
96.8
|
|
(49) %
|
|
(49) %
|
|
$
81.1
|
|
$
389.3
|
|
(79) %
|
|
(79) %
|
Equity
earnings
|
$
0.6
|
|
$
1.0
|
|
(40) %
|
|
(42) %
|
|
$
6.7
|
|
$
3.1
|
|
116 %
|
|
114 %
|
Adjusted
EBITDA1
|
$
76.1
|
|
$
115.9
|
|
(34) %
|
|
(34) %
|
|
$
173.1
|
|
$
444.0
|
|
(61) %
|
|
(61) %
|
Adjusted EBITDA margin
(local currency basis)
|
14.5 %
|
|
19.4 %
|
|
(510) bps
|
|
(490) bps
|
|
9.9 %
|
|
18.3 %
|
|
(840) bps
|
|
(840) bps
|
Adjusted EBITDA margin
(USD basis)
|
14.3 %
|
|
|
|
|
9.9 %
|
|
|
|
Note: For discussion
and reconciliation of non-GAAP financial measures, see the Notes
following the Financial Statements in this news release. Percentage
variances in the Performance
Highlights below are calculated and presented on a local currency
basis, unless otherwise noted.
|
Note: "Valuation
Advisory" was changed to "Value and Risk Advisory" in the third
quarter of 2023.
|
Lower Capital Markets revenue and fee revenue for the quarter
and full year reflected the meaningful drop in transaction volumes
compared with 2022. The rapid rise in interest rates and elevated
uncertainty this year prolonged investor decision making and drove
wide bid-ask spreads. This impact was most pronounced in Investment
Sales and Debt/Equity Advisory, which experienced declines across
most asset classes and geographies, on both a fourth-quarter and
full-year basis. This outperformed broader market trends as Q4
global market volumes for investment sales were down 23% in USD
(24% in local currency) according to JLL Research, the lowest
fourth quarter since 2011. Loan Servicing continued to achieve
growth in fees generated by the Fannie Mae DUS portfolio as core
servicing fees were up 6%, slightly offset by lower prepayment fees
as refinancing activity remained suppressed. On a full-year basis,
the $13.4 million decline in
prepayment fees outpaced the 6% year-to-date growth in core
servicing fees.
The margin contraction for the fourth quarter and full year were
predominantly driven by a decline in Investment Sales and
Debt/Equity Advisory revenues, net of lower commissions expense, as
well as incentive compensation accruals.
Work Dynamics 2023 Performance Highlights:
Work
Dynamics
($ in
millions, "LC" = local currency)
|
Three Months Ended
December 31,
|
|
%
Change
in USD
|
|
%
Change
in LC
|
|
Year Ended December
31,
|
|
%
Change
in USD
|
|
%
Change
in LC
|
2023
|
|
2022
|
|
|
|
2023
|
|
2022
|
|
|
Revenue
|
$
3,966.1
|
|
$
3,634.6
|
|
9 %
|
|
8 %
|
|
$
14,131.1
|
|
$
13,268.5
|
|
7 %
|
|
7 %
|
Gross contract
costs1
|
(3,383.9)
|
|
(3,100.3)
|
|
9
|
|
8
|
|
(12,131.4)
|
|
(11,403.8)
|
|
6
|
|
7
|
Fee
revenue1
|
$
582.2
|
|
$
534.3
|
|
9 %
|
|
8 %
|
|
$
1,999.7
|
|
$
1,864.7
|
|
7 %
|
|
7 %
|
Workplace
Management
|
239.9
|
|
202.3
|
|
19
|
|
17
|
|
806.4
|
|
752.8
|
|
7
|
|
7
|
Project
Management
|
258.2
|
|
250.1
|
|
3
|
|
2
|
|
928.4
|
|
850.7
|
|
9
|
|
9
|
Portfolio Services
and Other
|
84.1
|
|
81.9
|
|
3
|
|
1
|
|
264.9
|
|
261.2
|
|
1
|
|
1
|
Segment operating
income
|
$
100.1
|
|
$
64.6
|
|
55 %
|
|
55 %
|
|
$
183.8
|
|
$
158.4
|
|
16 %
|
|
15 %
|
Adjusted
EBITDA1
|
$
120.5
|
|
$
83.9
|
|
44 %
|
|
44 %
|
|
$
264.0
|
|
$
230.1
|
|
15 %
|
|
14 %
|
Adjusted EBITDA margin
(local currency basis)
|
21.0 %
|
|
15.7 %
|
|
500 bps
|
|
530 bps
|
|
13.1 %
|
|
12.3 %
|
|
90 bps
|
|
80 bps
|
Adjusted EBITDA margin
(USD basis)
|
20.7 %
|
|
|
|
|
13.2 %
|
|
|
Note: For discussion
and reconciliation of non-GAAP financial measures, see the Notes
following the Financial Statements in this news release. Percentage
variances in the Performance
Highlights below are calculated and presented on a local currency
basis, unless otherwise noted.
|
For both the fourth quarter and full year, Work Dynamics revenue
and fee revenue growth was broad-based across service lines and
geographies, led by strong performance in Workplace Management as
recent wins and mandate expansions ramped up in the second half of
the year. Momentum from increased project demand drove Project
Management growth for the fourth quarter and full year, though the
growth decelerated in the current quarter.
Adjusted EBITDA margin expansion for the fourth quarter was
attributable to the top-line performance described above, most
notably Workplace Management, and the reduction of certain expenses
associated with cost management actions over the last year.
Full-year adjusted EBITDA margin expansion was primarily driven
by Workplace Management and Project Management revenue growth as
well as cost management actions discussed above.
JLL Technologies 2023 Performance Highlights:
JLL
Technologies
($ in
millions, "LC" = local currency)
|
Three Months Ended
December 31,
|
|
%
Change
in USD
|
|
%
Change
in LC
|
|
Year Ended December
31,
|
|
%
Change
in USD
|
|
%
Change
in LC
|
2023
|
|
2022
|
|
|
|
2023
|
|
2022
|
|
|
Revenue
|
$
65.5
|
|
$
57.3
|
|
14 %
|
|
14 %
|
|
$
246.4
|
|
$
213.9
|
|
15 %
|
|
15 %
|
Gross contract
costs1
|
(3.5)
|
|
(3.1)
|
|
13
|
|
13
|
|
(14.5)
|
|
(13.7)
|
|
6
|
|
6
|
Fee
revenue1
|
$
62.0
|
|
$
54.2
|
|
14 %
|
|
14 %
|
|
$
231.9
|
|
$
200.2
|
|
16 %
|
|
16 %
|
Segment operating
income (loss)(a)
|
$
2.1
|
|
$
(22.4)
|
|
109 %
|
|
110 %
|
|
$
(35.0)
|
|
$
(112.9)
|
|
69 %
|
|
68 %
|
Equity (losses)
earnings
|
$
(75.0)
|
|
$
(17.9)
|
|
(319) %
|
|
(317) %
|
|
$
(177.0)
|
|
$
46.6
|
|
(480) %
|
|
(480) %
|
Adjusted
EBITDA1
|
$
(68.9)
|
|
$
(36.2)
|
|
(90) %
|
|
(90) %
|
|
$
(196.1)
|
|
$
(50.9)
|
|
(285) %
|
|
(286) %
|
Adjusted EBITDA margin
(local currency basis)
|
(111.3) %
|
|
(66.8) %
|
|
(4,430) bps
|
|
(4,450) bps
|
|
(84.9) %
|
|
(25.4) %
|
|
(5,920) bps
|
|
(5,950) bps
|
Adjusted EBITDA margin
(USD basis)
|
(111.1) %
|
|
|
|
|
(84.6) %
|
|
|
|
Note: For discussion
and reconciliation of non-GAAP financial measures, see the Notes
following the Financial Statements in this news release. Percentage
variances in the Performance
Highlights below are calculated and presented on a local currency
basis, unless otherwise noted.
|
(a) Included in Segment
operating income (loss) for JLL Technologies is a reduction in
carried interest expense of $4.4 million and $13.8 million for the
three and twelve months ended December 31,
2023, respectively. There was no carried interest for the three
months ended December 31, 2022, and $16.6 million of expense for
the twelve months ended December 31, 2022, related to Equity
earnings of the segment.
|
The fourth-quarter and full-year increases in JLL
Technologies revenue and fee revenue were primarily due to growth
in solutions and service offerings, largely from existing
enterprise clients. The fourth quarter increase was also partially
attributable to higher subscriptions revenue.
Equity losses for the fourth quarter resulted from valuation
declines in certain JLL Technologies' portfolio investments. The
2023 equity losses were largely driven by fair value declines
recognized in the second and fourth quarters of 2023 and reflected
the particularly challenging economic environment for venture
capital companies.
The margin decline for the quarter was entirely driven by the
equity losses described above, partially offset by (i) fee revenue
growth, (ii) the reduction in carried interest expense (associated
with equity losses), (iii) the reduction of certain expenses
associated with cost management actions and improved operating
efficiency over the last year and (iv) the timing of certain
operating expenses.
The full-year margin contraction was also entirely driven by the
equity losses described above, partially offset by (i) fee revenue
growth, (ii) the reduction in carried interest expense (associated
with equity losses) and (iii) the reduction of certain expenses
associated with cost management actions and improved operating
efficiency over the last year.
LaSalle 2023 Performance
Highlights:
LaSalle
($ in
millions, "LC" = local currency)
|
Three Months Ended
December 31,
|
|
%
Change
in USD
|
|
%
Change
in LC
|
|
Year Ended December
31,
|
|
%
Change
in USD
|
|
%
Change
in LC
|
2023
|
|
2022
|
|
|
|
2023
|
|
2022
|
|
|
Revenue
|
$
115.3
|
|
$
118.7
|
|
(3) %
|
|
(4) %
|
|
$
483.7
|
|
$
476.0
|
|
2 %
|
|
2 %
|
Gross contract
costs1
|
(6.9)
|
|
(7.3)
|
|
(5)
|
|
(6)
|
|
(28.9)
|
|
(29.3)
|
|
(1)
|
|
(2)
|
Fee
revenue1
|
$
108.4
|
|
$
111.4
|
|
(3) %
|
|
(4) %
|
|
$
454.8
|
|
$
446.7
|
|
2 %
|
|
2 %
|
Advisory
fees
|
92.8
|
|
96.0
|
|
(3)
|
|
(4)
|
|
377.2
|
|
380.3
|
|
(1)
|
|
—
|
Transaction fees and
other
|
7.4
|
|
5.9
|
|
25
|
|
22
|
|
30.1
|
|
39.8
|
|
(24)
|
|
(22)
|
Incentive
fees
|
8.2
|
|
9.5
|
|
(14)
|
|
(14)
|
|
47.5
|
|
26.6
|
|
79
|
|
79
|
Segment operating
income
|
$
17.6
|
|
$
26.7
|
|
(34) %
|
|
(31) %
|
|
$
95.4
|
|
$
90.1
|
|
6 %
|
|
7 %
|
Equity (losses)
earnings
|
$
(1.7)
|
|
$
(3.6)
|
|
53 %
|
|
50 %
|
|
$
(24.7)
|
|
$
0.4
|
|
n.m.
|
|
n.m.
|
Adjusted
EBITDA1
|
$
18.2
|
|
$
24.7
|
|
(26) %
|
|
(23) %
|
|
$
79.1
|
|
$
96.6
|
|
(18) %
|
|
(17) %
|
Adjusted EBITDA margin
(local currency basis)
|
17.7 %
|
|
22.2 %
|
|
(540) bps
|
|
(450) bps
|
|
17.5 %
|
|
21.6 %
|
|
(420) bps
|
|
(410) bps
|
Adjusted EBITDA margin
(USD basis)
|
16.8 %
|
|
|
|
|
17.4 %
|
|
|
Note: For discussion
and reconciliation of non-GAAP financial measures, see the Notes
following the Financial Statements in this news release. Percentage
variances in the Performance
Highlights below are calculated and presented on a local currency
basis, unless otherwise noted.
|
LaSalle's decrease in revenue
was largely attributable to advisory fees as lower asset valuations
over the past twelve months impacted assets under management. For
the full year, top-line growth was fueled by higher incentive
fees earned on asset dispositions on behalf of clients, following a
muted 2022, as advisory fees were stable. Lower transaction fees
reflected the global trends of dampened investment sales
transaction volumes.
The current-quarter and full-year equity losses were primarily
attributable to valuation declines in the co-investment portfolio.
In the fourth quarter, equity losses were largely offset by share
price appreciation related to the co-investment in a LaSalle-managed publicly-traded REIT in
Japan.
Adjusted EBITDA margin contraction for the quarter was
attributable to lower revenue as well as the timing of other
personnel costs and annual incentive compensation accruals.
For the full year, margin contraction was primarily driven by
equity losses in the current year (over 500 basis point negative
impact to margin), partially offset by higher incentive fees.
About JLL
For over 200 years, JLL (NYSE: JLL), a leading global commercial
real estate and investment management company, has helped clients
buy, build, occupy, manage and invest in a variety of commercial,
industrial, hotel, residential and retail properties. A Fortune
500® company with annual revenue of $20.8 billion and operations in over 80 countries
around the world, our more than 106,000 employees bring the power
of a global platform combined with local expertise. Driven by our
purpose to shape the future of real estate for a better world, we
help our clients, people and communities SEE A BRIGHTER
WAYSM. JLL is the brand name, and a registered
trademark, of Jones Lang LaSalle Incorporated. For further
information, visit jll.com.
Connect with us
https://www.linkedin.com/company/jll
https://www.facebook.com/jll
https://twitter.com/jll
Live
Webcast
|
|
Conference
Call
|
Management will offer a
live webcast for shareholders, analysts and investment
professionals on Tuesday, February 27, 2023, at 9:00 a.m. Eastern.
Following
the live broadcast, an audio replay will be available.
The link to the live
webcast and audio replay can be accessed at the Investor
Relations website: ir.jll.com.
|
|
The conference call can
be accessed live over the phone by
dialing (888) 660-6392; the conference ID number is 5398158.
Listeners are asked to please dial in 10 minutes prior to the
call
start time and provide the conference ID number to be
connected.
|
|
|
|
|
Supplemental
Information
|
|
Contact
|
Supplemental
information regarding the fourth quarter 2023 earnings call has
been posted to the Investor Relations section of JLL's website:
ir.jll.com.
|
|
If you have any
questions, please contact Scott Einberger, Investor Relations
Officer.
|
|
Phone:
|
+1 312 252
8943
|
|
Email:
|
JLLInvestorRelations@am.jll.com
|
Cautionary Note Regarding Forward-Looking
Statements
Statements in this news release regarding, among other
things, future financial results and performance, achievements,
plans, objectives and shares repurchases may be considered
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. Such statements involve
known and unknown risks, uncertainties, and other factors, the
occurrence of which are outside JLL's control which may cause JLL's
actual results, performance, achievements, plans, and objectives to
be materially different from those expressed or implied by such
forward-looking statements. For additional information concerning
risks, uncertainties, and other factors that could cause actual
results to differ materially from those anticipated in
forward-looking statements, and risks to JLL's business in general,
please refer to those factors discussed under "Risk Factors,"
"Business," "Management's Discussion and Analysis of Financial
Condition and Results of Operations," "Quantitative and Qualitative
Disclosures about Market Risk," and elsewhere in JLL's soon-to-be
filed Annual Report on Form 10-K for the year ended December 31, 2023 and other reports filed with
the Securities and Exchange Commission. Any forward-looking
statements speak only as of the date of this release, and except to
the extent required by applicable securities laws, JLL expressly
disclaims any obligation or undertaking to publicly update or
revise any forward-looking statements contained herein to reflect
any change in expectations or results, or any change in
events.
JONES LANG LASALLE
INCORPORATED
|
Consolidated
Statements of Operations (Unaudited)
|
|
|
Three Months Ended
December 31,
|
|
Year Ended December
31,
|
(in millions, except
share and per share data)
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
|
|
|
|
|
|
|
Revenue
|
$
5,881.4
|
|
$
5,604.8
|
|
$
20,760.8
|
|
$
20,862.1
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
Compensation and
benefits
|
$
2,666.1
|
|
$
2,549.4
|
|
$
9,770.7
|
|
$
10,010.8
|
Operating,
administrative and other
|
2,841.4
|
|
2,699.7
|
|
10,074.5
|
|
9,650.3
|
Depreciation and
amortization
|
61.9
|
|
62.6
|
|
238.4
|
|
228.1
|
Restructuring and
acquisition charges2
|
21.6
|
|
38.4
|
|
100.7
|
|
104.8
|
Total operating
expenses
|
$
5,591.0
|
|
$
5,350.1
|
|
$
20,184.3
|
|
$
19,994.0
|
|
|
|
|
|
|
|
|
Operating
income
|
$
290.4
|
|
$
254.7
|
|
$
576.5
|
|
$
868.1
|
|
|
|
|
|
|
|
|
Interest expense, net
of interest income
|
31.5
|
|
26.1
|
|
135.4
|
|
75.2
|
Equity (losses)
earnings
|
(76.8)
|
|
(21.6)
|
|
(194.1)
|
|
51.0
|
Other income
|
3.0
|
|
14.3
|
|
4.9
|
|
150.3
|
|
|
|
|
|
|
|
|
Income before income
taxes and noncontrolling interest
|
185.1
|
|
221.3
|
|
251.9
|
|
994.2
|
Income tax
provision
|
12.7
|
|
45.4
|
|
25.7
|
|
200.8
|
Net income
|
172.4
|
|
175.9
|
|
226.2
|
|
793.4
|
|
|
|
|
|
|
|
|
Net income attributable
to noncontrolling interest(a)
|
—
|
|
1.1
|
|
0.8
|
|
138.9
|
|
|
|
|
|
|
|
|
Net income attributable
to common shareholders
|
$
172.4
|
|
$
174.8
|
|
$
225.4
|
|
$
654.5
|
|
|
|
|
|
|
|
|
Basic earnings per
common share
|
$
3.63
|
|
$
3.68
|
|
$
4.73
|
|
$
13.51
|
Basic weighted average
shares outstanding (in 000's)
|
47,548
|
|
47,480
|
|
47,628
|
|
48,453
|
|
|
|
|
|
|
|
|
Diluted earnings per
common share
|
$
3.57
|
|
$
3.62
|
|
$
4.67
|
|
$
13.27
|
Diluted weighted
average shares outstanding (in 000's)
|
48,324
|
|
48,263
|
|
48,288
|
|
49,341
|
|
|
|
|
|
|
|
|
Please reference
accompanying financial statement notes.
|
|
|
|
|
|
|
|
|
(a) During the second
quarter of 2022, Other income included a $142.3 million gain by a
consolidated variable interest entity in which the company held no
equity interest. This gain, therefore, is also
included in the period's net income attributable to noncontrolling
interest. As a result, there is no net impact to Net income
attributable to common shareholders (or other measures like
Adjusted
EBITDA, Adjusted net income and Adjusted diluted earnings per
share).
|
JONES LANG LASALLE
INCORPORATED
|
Selected Segment
Financial Data (Unaudited)
|
|
Three Months Ended
December 31,
|
|
Year Ended December
31,
|
(in
millions)
|
2023
|
|
2022
|
|
2023
|
|
2022
|
MARKETS
ADVISORY
|
|
|
|
|
|
|
|
Revenue
|
$
1,197.4
|
|
$
1,186.3
|
|
$
4,121.6
|
|
$
4,415.5
|
Gross contract
costs1
|
(301.8)
|
|
(271.0)
|
|
(1,153.6)
|
|
(1,055.3)
|
Fee
revenue1
|
$
895.6
|
|
$
915.3
|
|
$
2,968.0
|
|
$
3,360.2
|
Compensation and
benefits, excluding gross contract costs
|
$
639.6
|
|
$
654.0
|
|
$
2,178.2
|
|
$
2,433.7
|
Operating,
administrative and other, excluding gross contract costs
|
94.9
|
|
112.4
|
|
368.3
|
|
405.0
|
Depreciation and
amortization
|
18.2
|
|
21.5
|
|
69.6
|
|
73.5
|
Segment fee-based
operating expenses
|
752.7
|
|
787.9
|
|
2,616.1
|
|
2,912.2
|
Gross contract
costs1
|
301.8
|
|
271.0
|
|
1,153.6
|
|
1,055.3
|
Segment operating
expenses
|
$
1,054.5
|
|
$
1,058.9
|
|
$
3,769.7
|
|
$
3,967.5
|
Segment operating
income
|
$
142.9
|
|
$
127.4
|
|
$
351.9
|
|
$
448.0
|
Add:
|
|
|
|
|
|
|
|
Equity
losses
|
(0.8)
|
|
(1.0)
|
|
(0.5)
|
|
(0.3)
|
Depreciation and
amortization(a)
|
17.1
|
|
20.6
|
|
65.6
|
|
70.6
|
Other
income
|
2.0
|
|
10.0
|
|
2.5
|
|
142.9
|
Net income
attributable to noncontrolling interest
|
—
|
|
(0.8)
|
|
(0.8)
|
|
(138.2)
|
Adjustments:
|
|
|
|
|
|
|
|
Net loss on
disposition
|
—
|
|
—
|
|
0.9
|
|
10.5
|
Interest on employee
loans, net of forgiveness
|
(0.7)
|
|
(6.0)
|
|
(3.0)
|
|
(6.0)
|
Adjusted
EBITDA1
|
$
160.5
|
|
$
150.2
|
|
$
416.6
|
|
$
527.5
|
|
|
|
|
|
|
|
|
CAPITAL
MARKETS
|
|
|
|
|
|
|
|
Revenue
|
$
537.1
|
|
$
607.9
|
|
$
1,778.0
|
|
$
2,488.2
|
Gross contract
costs1
|
(13.6)
|
|
(10.8)
|
|
(47.5)
|
|
(47.0)
|
Net non-cash MSR and
mortgage banking derivative activity
|
8.7
|
|
1.8
|
|
18.2
|
|
(11.0)
|
Fee
revenue1
|
$
532.2
|
|
$
598.9
|
|
$
1,748.7
|
|
$
2,430.2
|
Compensation and
benefits, excluding gross contract costs
|
$
394.6
|
|
$
408.4
|
|
$
1,337.7
|
|
$
1,727.1
|
Operating,
administrative and other, excluding gross contract costs
|
62.5
|
|
76.5
|
|
246.1
|
|
263.2
|
Depreciation and
amortization
|
17.1
|
|
15.4
|
|
65.6
|
|
61.6
|
Segment fee-based
operating expenses
|
474.2
|
|
500.3
|
|
1,649.4
|
|
2,051.9
|
Gross contract
costs1
|
13.6
|
|
10.8
|
|
47.5
|
|
47.0
|
Segment operating
expenses
|
$
487.8
|
|
$
511.1
|
|
$
1,696.9
|
|
$
2,098.9
|
Segment operating
income
|
$
49.3
|
|
$
96.8
|
|
$
81.1
|
|
$
389.3
|
Add:
|
|
|
|
|
|
|
|
Equity
earnings
|
0.6
|
|
1.0
|
|
6.7
|
|
3.1
|
Depreciation and
amortization
|
17.1
|
|
15.4
|
|
65.6
|
|
61.6
|
Other
income
|
1.0
|
|
4.6
|
|
2.5
|
|
4.7
|
Adjustments:
|
|
|
|
|
|
|
|
Net non-cash MSR and
mortgage banking derivative activity
|
8.7
|
|
1.8
|
|
18.2
|
|
(11.0)
|
Interest on employee
loans, net of forgiveness
|
(0.6)
|
|
(3.7)
|
|
(0.6)
|
|
(3.7)
|
Gain on
disposition
|
—
|
|
—
|
|
(0.4)
|
|
—
|
Adjusted
EBITDA1
|
$
76.1
|
|
$
115.9
|
|
$
173.1
|
|
$
444.0
|
(a) This adjustment
excludes the noncontrolling interest portion of amortization of
acquisition-related intangibles which is not attributable to common
shareholders.
|
JONES LANG LASALLE
INCORPORATED
|
|
Selected Segment
Financial Data (Unaudited) Continued
|
|
|
Three Months Ended
December 31,
|
|
Year Ended December
31,
|
|
(in
millions)
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
WORK
DYNAMICS
|
|
|
|
|
|
|
|
|
Revenue
|
$
3,966.1
|
|
$
3,634.6
|
|
$
14,131.1
|
|
$
13,268.5
|
|
Gross contract
costs1
|
(3,383.9)
|
|
(3,100.3)
|
|
(12,131.4)
|
|
(11,403.8)
|
|
Fee
revenue1
|
$
582.2
|
|
$
534.3
|
|
$
1,999.7
|
|
$
1,864.7
|
|
Compensation and
benefits, excluding gross contract costs
|
$
346.2
|
|
$
331.5
|
|
$
1,305.1
|
|
$
1,202.3
|
|
Operating,
administrative and other, excluding gross contract costs
|
115.6
|
|
118.2
|
|
431.6
|
|
432.9
|
|
Depreciation and
amortization
|
20.3
|
|
20.0
|
|
79.2
|
|
71.1
|
|
Segment fee-based
operating expenses
|
482.1
|
|
469.7
|
|
1,815.9
|
|
1,706.3
|
|
Gross contract
costs1
|
3,383.9
|
|
3,100.3
|
|
12,131.4
|
|
11,403.8
|
|
Segment operating
expenses
|
$
3,866.0
|
|
$
3,570.0
|
|
$
13,947.3
|
|
$
13,110.1
|
|
Segment operating
income
|
$
100.1
|
|
$
64.6
|
|
$
183.8
|
|
$
158.4
|
|
Add:
|
|
|
|
|
|
|
|
|
Equity earnings
(losses)
|
0.1
|
|
(0.1)
|
|
1.4
|
|
1.2
|
|
Depreciation and
amortization
|
20.3
|
|
20.0
|
|
79.2
|
|
71.1
|
|
Other
expense
|
—
|
|
(0.3)
|
|
—
|
|
(0.2)
|
|
Net income
attributable to noncontrolling interest
|
—
|
|
(0.3)
|
|
(0.4)
|
|
(0.4)
|
|
Adjusted
EBITDA1
|
$
120.5
|
|
$
83.9
|
|
$
264.0
|
|
$
230.1
|
|
|
|
|
|
|
|
|
|
|
JLL
TECHNOLOGIES
|
|
|
|
|
|
|
|
|
Revenue
|
$
65.5
|
|
$
57.3
|
|
$
246.4
|
|
$
213.9
|
|
Gross contract
costs1
|
(3.5)
|
|
(3.1)
|
|
(14.5)
|
|
(13.7)
|
|
Fee
revenue1
|
$
62.0
|
|
$
54.2
|
|
$
231.9
|
|
$
200.2
|
|
Compensation and
benefits, excluding gross contract costs(a)
|
$
45.4
|
|
$
54.6
|
|
$
200.7
|
|
$
240.3
|
|
Operating,
administrative and other, excluding gross contract costs
|
10.5
|
|
18.0
|
|
50.3
|
|
57.4
|
|
Depreciation and
amortization
|
4.0
|
|
4.0
|
|
15.9
|
|
15.4
|
|
Segment fee-based
operating expenses
|
59.9
|
|
76.6
|
|
266.9
|
|
313.1
|
|
Gross contract
costs1
|
3.5
|
|
3.1
|
|
14.5
|
|
13.7
|
|
Segment operating
expenses
|
$
63.4
|
|
$
79.7
|
|
$
281.4
|
|
$
326.8
|
|
Segment operating
income (loss)
|
$
2.1
|
|
$
(22.4)
|
|
$
(35.0)
|
|
$
(112.9)
|
|
Add:
|
|
|
|
|
|
|
|
|
Equity (losses)
earnings
|
(75.0)
|
|
(17.9)
|
|
(177.0)
|
|
46.6
|
|
Depreciation and
amortization
|
4.0
|
|
4.0
|
|
15.9
|
|
15.4
|
|
Other
income
|
—
|
|
0.1
|
|
—
|
|
3.0
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
Gain on
disposition
|
—
|
|
—
|
|
—
|
|
(3.0)
|
|
Adjusted
EBITDA1
|
$
(68.9)
|
|
$
(36.2)
|
|
$
(196.1)
|
|
$
(50.9)
|
|
(a) Included in
Compensation and benefits expense for JLL Technologies is carried
interest benefit of $4.4 million and $13.8 million for the three
and twelve months ended December 31, 2023, respectively.
There was no carried interest expense for the three months ended
December 31, 2022 and $16.6 million for the twelve months ended
December 31, 2022, related to Equity earnings of the
segment.
|
|
|
|
|
|
JONES LANG LASALLE
INCORPORATED
|
|
Selected Segment
Financial Data (Unaudited) Continued
|
|
|
|
|
|
|
|
Three Months Ended
December 31,
|
|
Year Ended December
31,
|
|
(in
millions)
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
LASALLE
|
|
|
|
|
|
|
|
|
Revenue
|
$
115.3
|
|
$
118.7
|
|
$
483.7
|
|
$
476.0
|
|
Gross contract
costs1
|
(6.9)
|
|
(7.3)
|
|
(28.9)
|
|
(29.3)
|
|
Fee
revenue1
|
$
108.4
|
|
$
111.4
|
|
$
454.8
|
|
$
446.7
|
|
Compensation and
benefits, excluding gross contract costs
|
$
72.2
|
|
$
64.7
|
|
$
288.7
|
|
$
290.4
|
|
Operating,
administrative and other, excluding gross contract costs
|
16.3
|
|
18.3
|
|
62.6
|
|
59.7
|
|
Depreciation and
amortization
|
2.3
|
|
1.7
|
|
8.1
|
|
6.5
|
|
Segment fee-based
operating expenses
|
90.8
|
|
84.7
|
|
359.4
|
|
356.6
|
|
Gross contract
costs1
|
6.9
|
|
7.3
|
|
28.9
|
|
29.3
|
|
Segment operating
expenses
|
$
97.7
|
|
$
92.0
|
|
$
388.3
|
|
$
385.9
|
|
Segment operating
income
|
$
17.6
|
|
$
26.7
|
|
$
95.4
|
|
$
90.1
|
|
Add:
|
|
|
|
|
|
|
|
|
Equity (losses)
earnings
|
(1.7)
|
|
(3.6)
|
|
(24.7)
|
|
0.4
|
|
Depreciation and
amortization
|
2.3
|
|
1.7
|
|
8.1
|
|
6.5
|
|
Other
expense
|
—
|
|
(0.1)
|
|
(0.1)
|
|
(0.1)
|
|
Net loss (income)
attributable to noncontrolling interest
|
—
|
|
—
|
|
0.4
|
|
(0.3)
|
|
Adjusted
EBITDA1
|
$
18.2
|
|
$
24.7
|
|
$
79.1
|
|
$
96.6
|
|
JONES LANG LASALLE
INCORPORATED
|
Consolidated
Statement of Cash Flows (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
Year Ended
December 31,
|
|
|
Year Ended
December 31,
|
(in
millions)
|
2023
|
|
2022
|
|
|
2023
|
|
2022
|
Cash flows from
operating activities:
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
Net income
|
$ 226.2
|
|
$ 793.4
|
|
Net capital additions
– property and equipment
|
$
(186.9)
|
|
$
(205.8)
|
Reconciliation of net
income to net cash used in operating activities:
|
|
|
|
|
Net investment asset
activity (less than wholly-owned)
|
—
|
|
134.8
|
Depreciation and
amortization
|
238.4
|
|
228.1
|
|
Business acquisitions,
net of cash acquired
|
(13.6)
|
|
(5.7)
|
Equity losses
(earnings)
|
194.1
|
|
(51.0)
|
|
Capital contributions
to investments
|
(109.4)
|
|
(167.3)
|
Net loss (gain) on
dispositions
|
0.5
|
|
(133.9)
|
|
Distributions of
capital from investments
|
23.7
|
|
24.4
|
Distributions of
earnings from investments
|
12.4
|
|
21.2
|
|
Other, net
|
(4.2)
|
|
(23.5)
|
Provision for loss on
receivables and other assets
|
20.3
|
|
27.0
|
|
Net cash used in
investing activities
|
(290.4)
|
|
(243.1)
|
Amortization of
stock-based compensation
|
78.3
|
|
85.8
|
|
Cash flows from
financing activities:
|
|
|
|
Net non-cash mortgage
servicing rights and mortgage banking derivative
activity
|
18.2
|
|
(11.0)
|
|
Proceeds from
borrowings under credit facility
|
7,684.0
|
|
7,560.0
|
Accretion of interest
and amortization of debt issuance costs
|
4.3
|
|
4.8
|
|
Repayments of
borrowings under credit facility
|
(8,284.0)
|
|
(6,485.0)
|
Other, net
|
17.5
|
|
5.9
|
|
Proceeds from senior
notes
|
400.0
|
|
—
|
Change in:
|
|
|
|
|
Repayments of senior
notes
|
—
|
|
(275.0)
|
Receivables
|
11.1
|
|
(291.3)
|
|
Net (repayments of)
proceeds from short-term borrowings
|
(24.8)
|
|
20.1
|
Reimbursable
receivables and reimbursable payables
|
(93.3)
|
|
(52.2)
|
|
Payments of deferred
business acquisition obligations and earn-outs
|
(26.6)
|
|
(12.6)
|
Prepaid expenses and
other assets
|
(24.0)
|
|
39.9
|
|
Shares repurchased for
payment of employee taxes on stock awards
|
(30.6)
|
|
(87.2)
|
Income taxes
receivable, payable and deferred
|
(138.8)
|
|
(105.1)
|
|
Repurchase of common
stock
|
(61.6)
|
|
(601.2)
|
Accounts payable,
accrued liabilities and other liabilities
|
78.5
|
|
(78.4)
|
|
Deconsolidation of
variable interest entity
|
—
|
|
(20.4)
|
Accrued compensation
(including net deferred compensation)
|
(67.9)
|
|
(283.3)
|
|
Noncontrolling
interest distributions, net
|
(6.5)
|
|
(142.7)
|
Net cash provided by
operating activities
|
$ 575.8
|
|
$ 199.9
|
|
Other, net
|
(24.2)
|
|
30.9
|
|
|
|
|
|
Net cash used in
financing activities
|
(374.3)
|
|
(13.1)
|
|
|
|
|
|
Effect of currency
exchange rate changes on cash, cash equivalents and restricted
cash
|
6.3
|
|
(39.3)
|
|
|
|
|
|
Net change in cash,
cash equivalents and restricted cash
|
$ (82.6)
|
|
$ (95.6)
|
|
|
|
|
|
Cash, cash equivalents
and restricted cash, beginning of the period
|
746.0
|
|
841.6
|
|
|
|
|
|
Cash, cash
equivalents and restricted cash, end of the period
|
$ 663.4
|
|
$ 746.0
|
|
|
|
|
|
|
|
|
|
Please reference
accompanying financial statement notes.
|
JONES LANG LASALLE
INCORPORATED
|
Consolidated Balance
Sheets
|
|
|
|
|
December
31,
|
|
December 31,
|
|
|
|
|
December
31,
|
|
December 31,
|
(in millions, except
share and per share data)
|
2023
|
|
2022
|
|
|
|
|
2023
|
|
2022
|
ASSETS
|
|
|
|
|
LIABILITIES AND
EQUITY
|
|
|
|
Current
assets:
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Cash and cash
equivalents
|
$
410.0
|
|
$
519.3
|
|
|
Accounts payable and
accrued liabilities
|
$
1,406.7
|
|
$
1,236.8
|
|
Trade receivables, net
of allowance
|
2,095.8
|
|
2,148.8
|
|
|
Reimbursable
payables
|
1,796.9
|
|
1,579.5
|
|
Notes and other
receivables
|
446.4
|
|
469.5
|
|
|
Accrued compensation
and benefits
|
1,698.3
|
|
1,749.8
|
|
Reimbursable
receivables
|
2,321.7
|
|
2,005.7
|
|
|
Short-term
borrowings
|
147.9
|
|
164.2
|
|
Warehouse
receivables
|
677.4
|
|
463.2
|
|
|
Short-term contract
liability and deferred income
|
226.4
|
|
216.5
|
|
Short-term contract
assets, net of allowance
|
338.3
|
|
359.7
|
|
|
Short-term
acquisition-related obligations
|
19.6
|
|
23.1
|
|
Prepaid and
other
|
567.4
|
|
603.5
|
|
|
Warehouse
facilities
|
662.7
|
|
455.3
|
|
|
Total current
assets
|
6,857.0
|
|
6,569.7
|
|
|
Short-term operating
lease liability
|
161.9
|
|
156.4
|
Property and equipment,
net of accumulated depreciation
|
613.9
|
|
582.9
|
|
|
Other
|
325.7
|
|
330.5
|
Operating lease
right-of-use asset
|
730.9
|
|
776.3
|
|
|
|
Total current
liabilities
|
6,446.1
|
|
5,912.1
|
Goodwill
|
4,587.4
|
|
4,528.0
|
|
Noncurrent
liabilities:
|
|
|
|
Identified intangibles,
net of accumulated amortization
|
785.0
|
|
858.5
|
|
|
Credit facility, net of
debt issuance costs
|
610.6
|
|
1,213.8
|
Investments
|
816.6
|
|
873.8
|
|
|
Long-term debt, net of
debt issuance costs
|
779.3
|
|
372.8
|
Long-term
receivables
|
363.8
|
|
331.1
|
|
|
Long-term deferred tax
liabilities, net
|
44.8
|
|
194.0
|
Deferred tax assets,
net
|
497.4
|
|
379.6
|
|
|
Deferred
compensation
|
580.0
|
|
492.4
|
Deferred compensation
plans
|
604.3
|
|
517.9
|
|
|
Long-term
acquisition-related obligations
|
51.1
|
|
76.3
|
Other
|
208.5
|
|
175.9
|
|
|
Long-term operating
lease liability
|
754.5
|
|
775.8
|
|
|
Total assets
|
$
16,064.8
|
|
$
15,593.7
|
|
|
Other
|
388.5
|
|
407.0
|
|
|
|
|
|
|
|
|
|
Total
liabilities
|
$
9,654.9
|
|
$
9,444.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Redeemable
noncontrolling interest
|
$
—
|
|
$
7.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company shareholders'
equity
|
|
|
|
|
|
|
|
|
|
Common stock
|
0.5
|
|
0.5
|
|
|
|
|
|
|
Additional paid-in
capital
|
2,019.7
|
|
2,022.6
|
|
|
|
|
|
|
|
|
Retained
earnings
|
5,795.6
|
|
5,590.4
|
|
|
|
|
|
|
Treasury
stock
|
(920.1)
|
|
(934.6)
|
|
|
|
|
|
|
|
|
Shares held in
trust
|
(10.4)
|
|
(9.8)
|
|
|
|
|
|
|
|
|
Accumulated other
comprehensive loss
|
(591.5)
|
|
(648.2)
|
|
|
|
|
|
|
|
|
Total company
shareholders' equity
|
6,293.8
|
|
6,020.9
|
|
|
|
|
|
|
Noncontrolling
interest
|
116.1
|
|
121.6
|
|
|
|
|
|
|
|
Total equity
|
6,409.9
|
|
6,142.5
|
|
|
|
|
|
|
|
Total liabilities and
equity
|
$
16,064.8
|
|
$
15,593.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Please reference
accompanying financial statement notes.
|
JONES LANG LASALLE INCORPORATED
Financial
Statement Notes
1. On February 15,
2024, management received a letter from the SEC Staff
informing the Company of the Staff's objection to the Company's
"Fee revenue" and "Fee-based operating expenses" non-GAAP measures,
citing questions 100.04 and 100.01 of the SEC Staff's non-GAAP
Compliance & Disclosure Interpretations as it relates to the
historical non-GAAP adjustment of Gross contract costs. As such,
effective with the first-quarter 2024 reporting cycle, the Company
will remove all references to both measures. Management is
currently reviewing options for revised presentation of non-GAAP
disclosures.
Management uses certain non-GAAP financial measures to develop
budgets and forecasts, measure and reward performance against those
budgets and forecasts, and enhance comparability to prior periods.
These measures are believed to be useful to investors and other
external stakeholders as supplemental measures of core operating
performance and include the following:
(i) Fee revenue and Fee-based operating
expenses,
(ii) Adjusted EBITDA attributable
to common shareholders ("Adjusted EBITDA") and Adjusted EBITDA
margin,
(iii) Adjusted net income (loss) attributable
to common shareholders and Adjusted diluted earnings (loss) per
share,
(iv) Percentage changes against prior
periods, presented on a local currency basis, and
(v) Free Cash Flow.
However, non-GAAP financial measures should not be considered
alternatives to measures determined in accordance with U.S.
generally accepted accounting principles ("GAAP"). Any measure that
eliminates components of a company's capital structure, cost of
operations or investments, or other results has limitations as a
performance measure. In light of these limitations, management also
considers GAAP financial measures and does not rely solely on
non-GAAP financial measures. Because the company's non-GAAP
financial measures are not calculated in accordance with GAAP, they
may not be comparable to similarly titled measures used by other
companies.
Adjustments to GAAP Financial Measures Used to Calculate
non-GAAP Financial Measures
Gross Contract Costs represent certain costs
associated with client-dedicated employees and third-party vendors
and subcontractors and are directly or indirectly reimbursed
through the fees we receive. These costs are presented on a gross
basis in Operating expenses with the equal amount of corresponding
fees in Revenue. Excluding gross contract costs from both Fee
revenue and Fee-based operating expenses more accurately reflects
how the company manages its expense base and operating margins and
also enables a more consistent performance assessment across a
portfolio of contracts with varying payment terms and
structures.
Net Non-Cash Mortgage Servicing Rights ("MSR") and
Mortgage Banking Derivative Activity consists of the
balances presented within Revenue composed of (i) derivative
gains/losses resulting from mortgage banking loan commitment and
warehousing activity and (ii) gains recognized from the retention
of MSR upon origination and sale of mortgage loans, offset by (iii)
amortization of MSR intangible assets over the period that net
servicing income is projected to be received. Non-cash derivative
gains/losses resulting from mortgage banking loan commitment and
warehousing activity are calculated as the estimated fair value of
loan commitments and subsequent changes thereof, primarily
represented by the estimated net cash flows associated with future
servicing rights. MSR gains and corresponding MSR intangible assets
are calculated as the present value of estimated cash flows over
the estimated mortgage servicing periods. The above activity is
reported entirely within Revenue of the Capital Markets segment.
Excluding net non-cash MSR and mortgage banking derivative activity
reflects how the company manages and evaluates performance because
the excluded activity is non-cash in nature.
Restructuring and Acquisition
Charges primarily consist of: (i) severance and
employment-related charges, including those related to external
service providers, incurred in conjunction with a structural
business shift, which can be represented by a notable change in
headcount, change in leadership or transformation of business
processes; (ii) acquisition, transaction and integration-related
charges, including fair value adjustments, which are generally
non-cash in the periods such adjustments are made, to assets and
liabilities recorded in purchase accounting such as earn-out
liabilities and intangible assets; and (iii) lease exit charges.
Such activity is excluded as the amounts are generally either
non-cash in nature or the anticipated benefits from the
expenditures would not likely be fully realized until future
periods. Restructuring and acquisition charges are excluded from
segment operating results and therefore are not line items in the
segments' reconciliation to Adjusted EBITDA.
Amortization of Acquisition-Related Intangibles,
primarily composed of the estimated fair value ascribed at closing
of an acquisition to assets such as acquired management contracts,
customer backlog and relationships, and trade name, is more notable
following the company's increase in acquisition activity in recent
years. Such non-cash activity is excluded as the change in
period-over-period activity is generally the result of longer-term
strategic decisions and therefore not necessarily indicative of
core operating results.
Gain or Loss on Disposition reflects the gain or
loss recognized on the sale of businesses. Given the low frequency
of business disposals by the company historically, the gain or loss
directly associated with such activity is excluded as it is not
considered indicative of core operating performance. In 2023, we
recorded a $0.5 million net loss,
versus a $7.5 million net loss in
2022.
Interest on Employee Loans, Net of Forgiveness
reflects interest accrued on employee loans less the amount of
accrued interest forgiven. Certain employees (predominantly in our
Leasing and Capital Markets businesses) receive cash payments
structured as loans, with interest. Employees earn forgiveness of
the loan based on performance, generally calculated as a percentage
of revenue production. Such forgiven amounts are reflected in
Compensation and benefits expense. Given the interest accrued on
these employee loans and subsequent forgiveness are non-cash and
the amounts perfectly offset over the life of the loan, the
activity is not indicative of core operating performance and is
excluded from non-GAAP measures.
Reconciliation of Non-GAAP Financial Measures
Below are reconciliations of (i) Revenue to Fee revenue and (ii)
Operating expenses to Fee-based operating expenses:
|
Three Months Ended
December 31,
|
|
Year Ended December
31,
|
(in
millions)
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
|
|
|
|
|
|
|
Revenue
|
$
5,881.4
|
|
$
5,604.8
|
|
$
20,760.8
|
|
$
20,862.1
|
Gross contract
costs1
|
(3,709.7)
|
|
(3,392.5)
|
|
(13,375.9)
|
|
(12,549.1)
|
Net non-cash MSR and
mortgage banking derivative activity
|
8.7
|
|
1.8
|
|
18.2
|
|
(11.0)
|
Fee revenue
|
$
2,180.4
|
|
$
2,214.1
|
|
$
7,403.1
|
|
$
8,302.0
|
|
|
|
|
|
|
|
|
Operating
expenses
|
$
5,591.0
|
|
$
5,350.1
|
|
$
20,184.3
|
|
$
19,994.0
|
Gross contract
costs1
|
(3,709.7)
|
|
(3,392.5)
|
|
(13,375.9)
|
|
(12,549.1)
|
Fee-based operating
expenses
|
$
1,881.3
|
|
$
1,957.6
|
|
$
6,808.4
|
|
$
7,444.9
|
Below are (i) a reconciliation of Net income attributable to
common shareholders to EBITDA and Adjusted EBITDA, (ii) a
reconciliation to Adjusted net income and (iii) components of
Adjusted diluted earnings per share.
|
Three Months Ended
December 31,
|
|
Year Ended December
31,
|
(in
millions)
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
|
|
|
|
|
|
|
Net income attributable
to common shareholders
|
$
172.4
|
|
$
174.8
|
|
$
225.4
|
|
$
654.5
|
Add:
|
|
|
|
|
|
|
|
Interest expense, net
of interest income
|
31.5
|
|
26.1
|
|
135.4
|
|
75.2
|
Income tax
provision
|
12.7
|
|
45.4
|
|
25.7
|
|
200.8
|
Depreciation and
amortization(a)
|
60.8
|
|
61.7
|
|
234.4
|
|
225.2
|
EBITDA
|
$
277.4
|
|
$
308.0
|
|
$
620.9
|
|
$
1,155.7
|
Adjustments:
|
|
|
|
|
|
|
|
Restructuring and
acquisition charges2
|
21.6
|
|
38.4
|
|
100.7
|
|
104.8
|
Net loss on
disposition
|
—
|
|
—
|
|
0.5
|
|
7.5
|
Net non-cash MSR and
mortgage banking derivative activity
|
8.7
|
|
1.8
|
|
18.2
|
|
(11.0)
|
Interest on employee
loans, net of forgiveness
|
(1.3)
|
|
(9.7)
|
|
(3.6)
|
|
(9.7)
|
Adjusted
EBITDA
|
$
306.4
|
|
$
338.5
|
|
$
736.7
|
|
$
1,247.3
|
|
Three Months Ended
December 31,
|
|
Year Ended December
31,
|
(In millions, except
share and per share data)
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
|
|
|
|
|
|
|
Net income attributable
to common shareholders
|
$
172.4
|
|
$
174.8
|
|
$
225.4
|
|
$
654.5
|
Diluted shares (in
thousands)
|
48,324
|
|
48,263
|
|
48,288
|
|
49,341
|
Diluted earnings per
share
|
$
3.57
|
|
$
3.62
|
|
$
4.67
|
|
$
13.27
|
|
|
|
|
|
|
|
|
Net income attributable
to common shareholders
|
$
172.4
|
|
$
174.8
|
|
$
225.4
|
|
$
654.5
|
Adjustments:
|
|
|
|
|
|
|
|
Restructuring and
acquisition charges2
|
21.6
|
|
38.4
|
|
100.7
|
|
104.8
|
Net non-cash MSR and
mortgage banking derivative activity
|
8.7
|
|
1.8
|
|
18.2
|
|
(11.0)
|
Amortization of
acquisition-related intangibles(a)
|
16.1
|
|
17.9
|
|
66.0
|
|
67.4
|
Net loss on
disposition
|
—
|
|
—
|
|
0.5
|
|
7.5
|
Interest on employee
loans, net of forgiveness
|
(1.3)
|
|
(9.7)
|
|
(3.6)
|
|
(9.7)
|
Tax impact of adjusted
items(b)
|
(13.0)
|
|
(12.6)
|
|
(49.7)
|
|
(38.4)
|
Adjusted net income
attributable to common shareholders
|
$
204.5
|
|
$
210.6
|
|
$
357.5
|
|
$
775.1
|
Diluted shares (in
thousands)
|
48,324
|
|
48,263
|
|
48,288
|
|
49,341
|
Adjusted diluted
earnings per share
|
$
4.23
|
|
$
4.36
|
|
$
7.40
|
|
$
15.71
|
|
|
(a)
|
This adjustment
excludes the noncontrolling interest portion of amortization of
acquisition-related intangibles which is not attributable to common
shareholders.
|
(b)
|
For all quarters of
2023 and second and fourth quarters of 2022, the tax impact of
adjusted items was calculated using the applicable statutory rates
by tax jurisdiction. For the first and third quarters of 2022, the
tax impact of adjusted items was calculated using the consolidated
effective tax rate as this was deemed to approximate the tax impact
of adjusted items calculated using applicable statutory tax
rates.
|
Below is a reconciliation of net cash provided by operating
activities to Free Cash Flow5.
|
Year Ended December
31,
|
(in
millions)
|
2023
|
|
2022
|
|
|
|
|
Net cash provided by
operating activities
|
$
575.8
|
|
$
199.9
|
|
|
|
|
Net capital additions -
property and equipment
|
(186.9)
|
|
(205.8)
|
|
|
|
|
Free Cash
Flow5
|
$
388.9
|
|
$
(5.9)
|
Operating Results - Local Currency
In discussing operating results, the company reports Adjusted
EBITDA margins and refers to percentage changes in local currency,
unless otherwise noted. Amounts presented on a local currency basis
are calculated by translating the current period results of foreign
operations to U.S. dollars using the foreign currency exchange
rates from the comparative period. Management believes this
methodology provides a framework for assessing performance and
operations excluding the effect of foreign currency
fluctuations.
The following table reflects the reconciliation to local
currency amounts for consolidated (i) Revenue, (ii) Fee revenue,
(iii) Operating income and (iv) Adjusted EBITDA.
|
Three Months Ended
December 31,
|
|
Year Ended December
31,
|
($ in
millions)
|
2023
|
|
%
Change
|
|
2023
|
|
%
Change
|
Revenue:
|
|
|
|
|
|
|
|
At current period
exchange rates
|
$
5,881.4
|
|
5 %
|
|
$
20,760.8
|
|
— %
|
Impact of change in
exchange rates
|
(44.3)
|
|
n/a
|
|
74.3
|
|
n/a
|
At comparative period
exchange rates
|
$
5,837.1
|
|
4 %
|
|
$
20,835.1
|
|
— %
|
|
|
|
|
|
|
|
|
Fee
revenue:
|
|
|
|
|
|
|
|
At current period
exchange rates
|
$
2,180.4
|
|
(2) %
|
|
$
7,403.1
|
|
(11) %
|
Impact of change in
exchange rates
|
(20.4)
|
|
n/a
|
|
11.5
|
|
n/a
|
At comparative period
exchange rates
|
$
2,160.0
|
|
(2) %
|
|
$
7,414.6
|
|
(11) %
|
|
|
|
|
|
|
|
|
Operating
income:
|
|
|
|
|
|
|
|
At current period
exchange rates
|
$
290.4
|
|
14 %
|
|
$
576.5
|
|
(34) %
|
Impact of change in
exchange rates
|
2.9
|
|
n/a
|
|
4.5
|
|
n/a
|
At comparative period
exchange rates
|
$
293.3
|
|
15 %
|
|
$
581.0
|
|
(33) %
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA:
|
|
|
|
|
|
|
|
At current period
exchange rates
|
$
306.4
|
|
(9) %
|
|
$
736.7
|
|
(41) %
|
Impact of change in
exchange rates
|
1.5
|
|
n/a
|
|
7.5
|
|
n/a
|
At comparative period
exchange rates
|
$
307.9
|
|
(9) %
|
|
$
744.2
|
|
(40) %
|
2. Restructuring and acquisition charges are
excluded from the company's measure of segment operating results,
although they are included within consolidated Operating income
calculated in accordance with GAAP. For purposes of segment
operating results, the allocation of Restructuring and acquisition
charges to the segments is not a component of management's
assessment of segment performance. The table below shows
Restructuring and acquisition charges.
|
Three Months Ended
December 31,
|
|
Year Ended December
31,
|
(in
millions)
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Severance and other
employment-related charges
|
$
14.2
|
|
$
23.5
|
|
$
62.1
|
|
$
44.5
|
Restructuring,
pre-acquisition and post-acquisition charges
|
11.3
|
|
18.4
|
|
43.0
|
|
63.6
|
Fair value adjustments
that resulted in a net decrease to earn-out liabilities from
prior-period
acquisition activity
|
(3.9)
|
|
(3.5)
|
|
(4.4)
|
|
(3.3)
|
Total Restructuring and
acquisition charges
|
$
21.6
|
|
$
38.4
|
|
$
100.7
|
|
$
104.8
|
3. n.m.: "not meaningful", represented by a
percentage change of greater than 1,000% or a change in margin of
greater than 10,000 basis points ("bps"), favorable or
unfavorable.
4. As of December 31,
2023, LaSalle had
$73.9 billion of real estate assets
under management ("AUM"), composed of $38.4
billion invested in fund management vehicles, $32.7 billion invested in separate accounts and
$2.8 billion invested in public
securities. The geographic distribution of separate accounts and
fund management investments was $28.5
billion in North America,
$12.3 billion in the U.K.,
$14.5 billion in Asia Pacific and $9.1
billion in continental Europe. The remaining $6.7 billion relates to Global Partner Solutions
which is a global business line.
Compared with AUM of $77.7 billion
as of September 30, 2023, the AUM as
of December 31, 2023, decreased 5% in
USD (3% in local currency). The net decrease in AUM during the
quarter resulted from (i) $1.7
billion of foreign currency decreases, (ii) $1.4 billion of net valuation decreases and (iii)
$1.2 billion of dispositions and
withdrawals, partially offset by (iv) $0.5
billion of acquisitions.
Assets under management data for separate accounts and fund
management amounts are reported on a one-quarter lag. In addition,
LaSalle raised $1.2 billion in private equity capital for the
quarter ended December 31, 2023.
5. "Net Debt" is defined as the sum of the (i)
Credit facility, (ii) Long-term debt and (iii) Short-term
borrowings liability balances less Cash and cash equivalents.
"Net Leverage Ratio" is defined as Net Debt divided by the
trailing-twelve-month Adjusted EBITDA.
"Corporate Liquidity" is defined as the unused portion of the
company's Credit Facility plus cash and cash equivalents.
"Free Cash Flow" is defined as cash provided by operating
activities less net capital additions - property and equipment.
6. The company defines "Resilient" revenue as (i)
Property Management, within Markets Advisory, (ii) Value and Risk
Advisory, and Loan Servicing, within Capital Markets, (iii)
Workplace Management, within Work Dynamics, (iv) JLL Technologies,
and (v) Advisory Fees, within LaSalle.
The company defines "Transactional" revenue as (i) Leasing and
Advisory, Consulting and Other, within Markets Advisory, (ii)
Investment Sales, Debt/Equity Advisory and Other, within Capital
Markets, (iii) Project Management and Portfolio Services and Other,
within Work Dynamics, and (iv) Incentive fees and Transaction fees
and other, within LaSalle.
Appendix: Revenue and Fee Revenue Segment Detail
|
Three Months Ended
December 31, 2023
|
(in
millions)
|
Markets
Advisory
|
|
Capital
Markets
|
|
Work
Dynamics
|
|
|
|
|
|
|
|
Leasing
|
Property
Mgmt
|
Advisory,
Consulting
and Other
|
|
Total
Markets
Advisory
|
|
Invt Sales,
Debt/Equity
Advisory
and Other
|
Value and
Risk
Advisory
|
Loan
Servicing
|
|
Total
Capital
Markets
|
|
Workplace
Mgmt
|
Project
Mgmt
|
Portfolio
Services
and Other
|
|
Total
Work
Dynamics
|
|
JLLT
|
|
LaSalle
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
$ 717.5
|
445.8
|
34.1
|
|
$
1,197.4
|
|
$ 391.3
|
107.7
|
38.1
|
|
$ 537.1
|
|
$
3,018.5
|
798.3
|
149.3
|
|
$
3,966.1
|
|
$
65.5
|
|
$ 115.3
|
|
$
5,881.4
|
Gross contract
costs1
|
(8.2)
|
(290.6)
|
(3.0)
|
|
(301.8)
|
|
(9.0)
|
(4.6)
|
—
|
|
(13.6)
|
|
(2,778.6)
|
(540.1)
|
(65.2)
|
|
(3,383.9)
|
|
(3.5)
|
|
(6.9)
|
|
(3,709.7)
|
Net non-cash MSR
and mortgage banking derivative activity
|
—
|
—
|
—
|
|
—
|
|
8.7
|
—
|
—
|
|
8.7
|
|
—
|
—
|
—
|
|
—
|
|
—
|
|
—
|
|
8.7
|
Fee
revenue
|
$ 709.3
|
155.2
|
31.1
|
|
$ 895.6
|
|
$ 391.0
|
103.1
|
38.1
|
|
$ 532.2
|
|
$ 239.9
|
258.2
|
84.1
|
|
$ 582.2
|
|
$
62.0
|
|
$ 108.4
|
|
$
2,180.4
|
|
Three Months Ended
December 31, 2022
|
(in
millions)
|
Markets
Advisory
|
|
Capital
Markets
|
|
Work
Dynamics
|
|
|
|
|
|
|
|
Leasing
|
Property
Mgmt
|
Advisory,
Consulting
and Other
|
|
Total
Markets
Advisory
|
|
Invt Sales,
Debt/Equity
Advisory
and Other
|
Value and
Risk
Advisory
|
Loan
Servicing
|
|
Total
Capital
Markets
|
|
Workplace
Mgmt
|
Project
Mgmt
|
Portfolio
Services
and Other
|
|
Total Work
Dynamics
|
|
JLLT
|
|
LaSalle
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
$ 746.6
|
398.8
|
40.9
|
|
$
1,186.3
|
|
$ 464.6
|
106.2
|
37.1
|
|
$ 607.9
|
|
$
2,635.7
|
856.9
|
142.0
|
|
$
3,634.6
|
|
$ 57.3
|
|
$ 118.7
|
|
$
5,604.8
|
Gross contract
costs1
|
(6.7)
|
(262.3)
|
(2.0)
|
|
(271.0)
|
|
(8.3)
|
(2.5)
|
—
|
|
(10.8)
|
|
(2,433.4)
|
(606.8)
|
(60.1)
|
|
(3,100.3)
|
|
(3.1)
|
|
(7.3)
|
|
(3,392.5)
|
Net non-cash MSR
and mortgage banking derivative activity
|
—
|
—
|
—
|
|
—
|
|
1.8
|
—
|
—
|
|
1.8
|
|
—
|
—
|
—
|
|
—
|
|
—
|
|
—
|
|
1.8
|
Fee
revenue
|
$ 739.9
|
136.5
|
38.9
|
|
$ 915.3
|
|
$ 458.1
|
103.7
|
37.1
|
|
$ 598.9
|
|
$ 202.3
|
250.1
|
81.9
|
|
$ 534.3
|
|
$ 54.2
|
|
$ 111.4
|
|
$
2,214.1
|
Appendix: Revenue and Fee Revenue Segment Detail
(continued)
|
Year Ended December
31, 2023
|
(in
millions)
|
Markets
Advisory
|
|
Capital
Markets
|
|
Work
Dynamics
|
|
|
|
|
|
|
|
Leasing
|
Property
Mgmt
|
Advisory,
Consulting
and Other
|
|
Total
Markets
Advisory
|
|
Invt Sales,
Debt/Equity
Advisory
and Other
|
Value and
Risk
Advisory
|
Loan
Servicing
|
|
Total
Capital
Markets
|
|
Workplace
Mgmt
|
Project
Mgmt
|
Portfolio
Services
and Other
|
|
Total
Work
Dynamics
|
|
JLLT
|
|
LaSalle
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
$
2,343.6
|
1,675.1
|
102.9
|
|
$
4,121.6
|
|
$
1,261.6
|
363.8
|
152.6
|
|
$
1,778.0
|
|
$ 10,706.2
|
2,924.8
|
500.1
|
|
$
14,131.1
|
|
$ 246.4
|
|
$ 483.7
|
|
$
20,760.8
|
Gross contract
costs1
|
(21.3)
|
(1,123.4)
|
(8.9)
|
|
(1,153.6)
|
|
(34.8)
|
(12.7)
|
—
|
|
(47.5)
|
|
(9,899.8)
|
(1,996.4)
|
(235.2)
|
|
(12,131.4)
|
|
(14.5)
|
|
(28.9)
|
|
(13,375.9)
|
Net non-cash MSR
and mortgage banking derivative activity
|
—
|
—
|
—
|
|
—
|
|
18.2
|
—
|
—
|
|
18.2
|
|
—
|
—
|
—
|
|
—
|
|
—
|
|
—
|
|
18.2
|
Fee
revenue
|
$
2,322.3
|
551.7
|
94.0
|
|
$
2,968.0
|
|
$
1,245.0
|
351.1
|
152.6
|
|
$
1,748.7
|
|
$ 806.4
|
928.4
|
264.9
|
|
$
1,999.7
|
|
$ 231.9
|
|
$ 454.8
|
|
$
7,403.1
|
|
Year Ended December 31,
2022
|
(in
millions)
|
Markets
Advisory
|
|
Capital
Markets
|
|
Work
Dynamics
|
|
|
|
|
|
|
|
Leasing
|
Property
Mgmt
|
Advisory,
Consulting
and Other
|
|
Total
Markets
Advisory
|
|
Invt Sales,
Debt/Equity
Advisory
and Other
|
Value and
Risk
Advisory
|
Loan
Servicing
|
|
Total
Capital
Markets
|
|
Workplace
Mgmt
|
Project
Mgmt
|
Portfolio
Services
and Other
|
|
Total Work
Dynamics
|
|
JLLT
|
|
LaSalle
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
$
2,759.2
|
1,525.3
|
131.0
|
|
$
4,415.5
|
|
$
1,955.4
|
374.9
|
157.9
|
|
$
2,488.2
|
|
$
9,819.2
|
2,972.3
|
477.0
|
|
$ 13,268.5
|
|
$ 213.9
|
|
$ 476.0
|
|
$ 20,862.1
|
Gross contract
costs1
|
(22.5)
|
(1,025.1)
|
(7.7)
|
|
(1,055.3)
|
|
(37.7)
|
(9.3)
|
—
|
|
(47.0)
|
|
(9,066.4)
|
(2,121.6)
|
(215.8)
|
|
(11,403.8)
|
|
(13.7)
|
|
(29.3)
|
|
(12,549.1)
|
Net non-cash MSR
and mortgage banking derivative activity
|
—
|
—
|
—
|
|
—
|
|
(11.0)
|
—
|
—
|
|
(11.0)
|
|
—
|
—
|
—
|
|
—
|
|
—
|
|
—
|
|
(11.0)
|
Fee
revenue
|
$
2,736.7
|
500.2
|
123.3
|
|
$
3,360.2
|
|
$
1,906.7
|
365.6
|
157.9
|
|
$
2,430.2
|
|
$ 752.8
|
850.7
|
261.2
|
|
$
1,864.7
|
|
$ 200.2
|
|
$ 446.7
|
|
$
8,302.0
|
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SOURCE JLL-IR